There is somewhat good news for construction output in March, but with some caveats for the whole quarter
The Office for National Statistics (ONS) stats for March and Q1 2026 show that the first four months of the year saw an overall growth of 0.4%.
This, however, was almost entirely driven by a growth in repair and maintenance activity.
New work is still suffering
Repair and maintenance grew by 3.4% over the last quarter, accounting for most of the growth, but the true reflection for the industry is more mixed, as new work declined by 1.9%. Private housing repair and maintenance was the strongest sector, rising 4.1% over the quarter.
In March, construction output rose by 1.5%, a jump from February’s 0.5% or 0.7% in January. New work increased by 2.0%, and repair and maintenance increased by 0.8%.
March’s positivity was not enough to offset the overall decline in Q1, however, as quarter-by-quarter, new orders dropped by 10.5% from Q4 2025. This is equivalent to dropping £1.238bn.
The end of the financial year may have had an effect
Private commercial work and infrastructure projects weakened, being a major cause for this drop in new orders. Many businesses indicated that they pushed projects to be completed before the end of the financial year, which could also account for the growth seen in March.
Clive Docwra, managing director of property and construction consultancy McBains, said: “Following growth in February exceeding expectations, March’s return will give further heart to the industry.
“Overall growth of 1.5% in March is much better than expected given that these figures cover the first full month after the outbreak of the Iran war, while new work such as private housing increasing by 2.8% and commercial orders by 3.4% during the month are particularly pleasing.
“However, the sector will be sounding a note of caution as factors such as continued unpredictability in the Middle East and rising inflation will continue to have an impact in terms of sluggish demand over the coming months.
“The current uncertainty around the PMs position may also worry some investors in terms of whether a leadership change could result in policy shifts. Even the recent local election results could also have a bearing on projects going ahead – as witnessed by reports that the new local council in Enfield may shelve plans for the shortlisted new town.
“So while today’s figures are welcome, the bigger picture remains one of cautious optimism.”
The ONS stats March 2026 can be found here.
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